Members of the Wales Tourism Alliance (WTA) have given a blunt “No way” reaction to the Welsh Government’s proposed tourism tax.
First Minister Mark Drakeford has claimed that the tax, charged to people visiting Wales, would benefit the tourism industry. But members of the WTA, which represents all sectors of tourism industry in Wales, unanimously disagreed at their meeting today.
In its five-year plan, published last week, the Welsh Government pledged to consult on legislation that would permit local authorities to raise such a levy.
WTA chairman Andrew Campbell blasted the timing of the tax proposal as insensitive and said it showed a lack of respect to the tourism industry in Wales when a recruitment crisis is hampering recovery from the Covid-19 pandemic.
“The feeling around the table was ‘No way’,” he said. “ Not only will it make the industry less competitive, sending out a perception that Wales will be a more expensive destination to visit, but businesses are already struggling to bounce back financially from the pandemic.
“Businesses might have reopened but they now have to pay all the bills that have been pushed back. VAT is going to be restored to normal in September, furlough is finishing, and loans have to be repaid.
“Rather than proposing a new tax, the Welsh Government should be focusing on financial support to help the sector.
“The First Minister pointed out that tourism tax has been successfully introduced in many destinations throughout the world. That may be true, but many of those destinations do not have to contend with VAT rates of 20%.
“The average VAT rate within Eurozone countries for instance is 10%. The tax burden placed upon our businesses is already high.”
Mr Campbell stated that the implementation of such a tax would also affect supply chains and would disproportionately impact upon lower income groups who are already struggling to afford a holiday in Wales
“The Welsh Government will consult with the industry, but the answer will be ‘No’ to the tax. Charging visitors more is not the solution to any problems associated with visitor management. A more sustainable approach is required, based upon better planning and greater dialogue with local communities.”
